The biggest challenge facing the government’s new plan for better health care

January 30, 2015 9:39 PM

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The Obama administration earlier this week announced a not-so radical idea: Medicare, the massive health-care program for seniors, should do a much better job of paying doctors and hospitals for quality, not quantity, when it comes to care. Instead of paying a flat fee for each service, the administration said by 2018 it wants half of Medicare payments to hospitals and care providers to be calculated based on whether patients see better results.

Because Medicare is such a huge part of overall health care spending, the hope is that these changes will trickle out to doctors offices and hospitals across the country, reshaping how everyone gets treated. And many of these same efforts are already under way in the private sector.